KUALA LUMPUR: CIMB Equities Research said Tomyopak's failure to pass through cost increases was the main reason for its poor interims.
The research house said on Friday, Aug 19 that annualised 1H11 net profit was only 62% of its forecast though this did not stop the company from meeting its 1.4 sen interim DPS expectations.
'Although we foresee a strong earnings recovery in 2H following the recent steep fall in raw material prices, we are slashing our FY11 EPS by 21% for the weak 1H earnings. But FY12-13 EPS forecasts and FY11-13 DPS numbers are intact,' it said.
CIMB Research retained its RM1.52 target price as it continues to value Tomypak at 6x CY12 P/E, a 40% discount to its 10.1x CY12 target P/E for Daibochi. CY12 P/E is only 4x while gross dividend yields are 8-10%.
'We maintain our OUTPERFORM rating as a continuation of the raw material price decline could spark a re-rating,' it said.
The research house said on Friday, Aug 19 that annualised 1H11 net profit was only 62% of its forecast though this did not stop the company from meeting its 1.4 sen interim DPS expectations.
'Although we foresee a strong earnings recovery in 2H following the recent steep fall in raw material prices, we are slashing our FY11 EPS by 21% for the weak 1H earnings. But FY12-13 EPS forecasts and FY11-13 DPS numbers are intact,' it said.
CIMB Research retained its RM1.52 target price as it continues to value Tomypak at 6x CY12 P/E, a 40% discount to its 10.1x CY12 target P/E for Daibochi. CY12 P/E is only 4x while gross dividend yields are 8-10%.
'We maintain our OUTPERFORM rating as a continuation of the raw material price decline could spark a re-rating,' it said.
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